Buffett is one of many investors who once avoided
airline stocks like a CEO avoids flying coach — with ample reason.
Airline stocks like Southwest, JetBlue and American Airlines were broadly weaker Wednesday, dragged down after United discussed its growth plans after its quarterly earnings report Tuesday evening, a report that did in fact beat estimates.
Not exact matches
If the
airlines show they can withstand the next downturn, Miller says, it could «lead to a significant re-rating» in which investors price
airline stocks more
like industrial
stocks — in other words, at twice the price where they currently trade.
Value investor Bill Miller, who's had a strong track record over the years, tells CNBC he's not giving up on
stocks and
likes airlines and homebuilders.
«I keep highlighting the bizarrely bullish ways that
stocks are trading and sometimes they're totally in your face,
like this simultaneous move in the price of oil and the
airline stocks.»
Cramer speculated that money managers refuse to pay up for a
stock like the
airlines if they think the U.S. is headed into a recession.
There are large
stock market companies
like Procter & Gamble, which has had meaningful employee share ownership along with profit - sharing for more than a century, and Southwest
Airlines, which has both employee share ownership and an annual cash profit sharing plan that in 2015 paid $ 620 million in profits to all employees, adding 15 % on top of their wages and salaries.4 Divisions of
stock market companies are sometimes spun off and sold to workers through ESOPs: the 100 % employee - owned Scot Forge in Clinton, Wisconsin, and the 100 % employee - owned Houchens in Bowling Green, Kentucky, are examples.
Cyclical
Stocks are usually associated with companies selling largely - discretionary items
like airline -LSB-...]
But we can see why
airline CEOs want more transparency in this lucrative business: some,
like Doug Parker of American
Airlines, get paid completely in company
stock.
So while
airlines like easyJet, Ryanair and Frontier may not
stock the most gourmet snacks, their planes do need to meet the customary standards to which all airplanes are upheld, from staff training to plane maintenance.
For example, before heading to the online Pottery Barn Kids website to order personalized
stockings for your little ones to hang on the fireplace, to earn
airline miles, you must first head to a site
like United MileagePlus Shopping and log in with your frequent - flyer information.
«Some have suggested that new technologies should make buying a home more
like buying an
airline ticket or a
stock certificate, but they're missing the point.